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Top Five Problems with Surety Bonds

Top Five Problems with Surety Bonds
  Let's face it: security deposits are a big headache for both apartment residents and operators alike.For applicants – especially in this day of growing rents and stagnant incomes – it's often not possible to pull together the funds necessary to make a big security deposit payment. And when a lease is over, residents are almost inevitably upset about the portion of their deposit that is returned to them. This in turn leads to bitterly angry online reviews that can lay waste to an operator's reputation.Security deposits also saddle apartment operators with the significant administrative costs and burdens associated with managing the deposits, issuing refund checks and handling reimbursement disputes. Another frequent pain point is the mismanagement of deposit pools mean to protect operators against lease skips, damages and bad debt. Furthermore, the inability of many applicants to pay for a security deposit means operators are losing out on prospects who would become high-quality residents.In their quest to find an alternative to security deposits, many operators turn to surety bonds. Surety bonds are a three-party system consisting typically of the resident, the property and the bond guarantor. The renter pays only a portion – typically 17.5 percent – of the total deposit amount at move-in as a non-refundable fee.The bonds enable residents to save money up front and move into the apartment homes they really want. For operators, they can help expand the renter pool, leading to more conversions, higher occupancies and increased revenue.But these instruments carry considerable drawbacks as well. Below a......
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Lead Nurturing, AUTONOMOUSLY.

Prospect Follow-up for Multifamily   Hy.ly surveyed 50+ properties in Spring 2018 to evaluate the state of Multifamily automation for new prospect follow-up. According to our survey, 90.6% of the big REITs send nurturing prospect follow-up. Pretty impressive. Yet, a measly 12.5% of 3rd Party Managers did the same.  Ouch. Before you start judging 3rd Party Managers too harshly, you need to consider the facts. Most 3rd Party managers’ operations are not structured to scale and they are severely resource constrained. Without a digital workforce, it is just about impossible for a 3rd Party Manager to keep up with prospects, residents and on-site maintenance. We believe this is a big problem and want to help Multifamily understand how to nurture new prospects using Autonomous Lifecycle Marketing (ALM)!     Before we jump into the Prospect Zone, here is a refresher on the concepts behind ALM: A playbook is the complete guide to automated customer lifecycle marketing. It maps out personalized content to engage customers from the time a prospect fills out a guest card until they move out. A zone defines where the customer falls in the customer journey. A play is designed to move customers from one lifecycle stage to the next.    What is the Prospect Zone The Prospect Zone covers customers from the moment they fill out a contact card until they sign a lease or become inactive for 60+ days. The purpose of the Prospect Zone Plays is to excite and inform prospects about your property. Thereby, making them more likely to sign a lease.   &......
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More on that Strange Creature, Homo Millennius

Millennials I’m an avid reader of The Economist, and I recently read an interesting article on how marketers are trying to address the Millennial generation. As readers of past blogs may recall, I’m a confirmed cynic that the generation represents a fundamentally different species (metaphorically); so, I was immediately drawn in by the observation in the article that the reason so many companies struggle to understand the differences between Millennials and other generations “may be because such differences are overblown.”   Ipsos-MORI is quoted as saying that Millennials are “the most carelessly described group we have ever looked at.” The article quotes a MillerCoors failure to sell to Millennials by creating TwoHats, a light-flavored fruity brew they said would appeal to Millennials taste and budget with the tagline, “Good, cheap beer. Wait, what?”  The article does say that Millennials do respond to three big themes: transparency, experience over possessions and flexibility. They cite examples such as:  Everlane, an online clothing manufacturer offering “radical transparency” by disclosing both the conditions under which each garment is made and the profit being earned  A large company, ConAgra, has succeeded in growing sales by eliminating all artificial ingredients from its snack and ready meals  Airbnb is the classic example of enabling more experiences through both reducing the price of stays and selling experience-oriented programs  AllyBank has offered flexibility with checking accounts that have no minimum balances and no fees  Carmakers are experimenting with subscription services, rather than ownership—another example of increasing flexibility even in a durable goods category To test the validity of these thoughts, I turned once again to......
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7 Essential Text Messaging Stats Every Property Manager Should Know

  7 Essential Text Messaging Stats Every Property Manager Should Know SMS marketing is quickly becoming a necessary part of business for every vertical - including property management. In recent years, text messaging has proven itself to be a superior communication platform. Texting has become the preferred method of communication between friends and colleagues because it's quick, easy and multi-functional. Because of this, property managers are finding creative ways to use this technology as a reliable resident communications tool - it's the ideal way to let residents know that there's work being done in their community, that the water is going to be out for a few hours, or even letting them know about emergency scenarios if necessary.  If you haven’t yet, you should be looking into ways to utilize a text strategy within your resident communities. In today’s world, few approaches compare. Check out the seven mind-blowing statistics surrounding text messaging, and consider the many ways an intuitive text message platform can help strengthen your community: 95 to 98% of texts are read immediately: These texts are read within one minute of receipt, influencing the recipient (resident) almost immediately. This makes text messaging one of the fastest and most convertible forms of communication available. (Source: MobileMarketing.com) The average response time for a text message is just 90 seconds: Compare that to the average response time for an email, which is 90 minutes (Source: CTIA.org) 86% of consumers send and receive texts every week: Today’s modern consumers are mobile-centric, so it isn’t a surprise how often the......
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7 Common Code Violations that You Don't Want to Overlook

Maintaining your building can be difficult to say the least, here are 7 common items that are usually overlooked but can usually, be fixed in minutes. These tips may seem easy but they get overlooked often. 1) Missing & Broken Smoke Alarms and Carbon Monoxide Detectors - Every bedroom in the home is required to have a hard-wired smoke alarm in the room, and in the hallway outside of all sleeping areas.  Many municipalities also now require carbon monoxide detectors.  You not only need to make sure your smoke alarms are installed correctly, but also that they’re working properly.  One of the most common issues are dead batteries. New smoke and carbon monoxide detectors are tamper proof and come with a 10-year battery. 2) Hazardous Windows - Some homeowners look at windows as an added bonus, but fail to consider their condition, location, and type of glass. Your first order-of-business should be to replace windows near stairs and in bathrooms with tempered or safety-glazed glass. In fact, building codes require safety glass in new homes with windows that are near stairs and doorways, in showers, or pretty much any place where someone could slip and fall into the glass. Experts recommend that any single-pane windows be traded in for double-pane versions. Here are a few additional questions and tips to keep in mind. a) Do the frames have wind load labels?b) Is the glazing double or triple glazed to provide insulation and to resist impact? c) Are there visible fasteners to a......
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Protecting yourself against serial skippers

Many apartment communities face the challenge of residents who skip out on leases before they’re fulfilled. And every resident who skips out on a lease leaves an unexpected vacancy in his or her wake. Residents skip out on leases for many different reasons. Sometimes they’re the victims of an unfortunate circumstance (e.g., an unexpected job loss), but for some renters, it’s intentional — and they’ve made a habit of doing it wherever they go. Residents who consistently leave behind unfulfilled lease terms to bolt for the next community are known as “serial skippers.” Serial skippers are obviously bad for a multifamily community. They not only harm communities financially, but also require operators to spend money to turn unexpectedly vacant units. But fortunately, rental screening technology has come a long way over the years, and there are effective ways to identify whether a prospective resident is likely to be a serial skipper.  The best way to protect against serial skippers is to reject their lease applications from the start. But that’s easier said than done, because it can take months before rental collections are reported to the credit bureaus. To catch them before they strike again, operators need to know the limitations of certain screening methods and the opportunities available through newer screening methods. Limitations of credit reports and scoresChecking credit reports and scores is a routine part of any community’s resident screening process. Generally speaking, credit reports and scores provide a very good indication of how consistently an applicant pays his or her bills. But......
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Success Tip: Why Do Cokes Taste Better at McDonald's?

Success Tip: Why Do Cokes Taste Better at McDonald's?
Have you noticed that Cokes just taste DIFFERENT at McDonald’s? (Now for you more health conscious individuals I feel the need to mention that I don’t frequent McDonald’s much any more. Apparently the older I get the more my body tells me, “You can’t eat like a teenager anymore!”) Well, I did some research and it really is a thing that McDonald’s Cokes (and Diet Cokes) do taste different and there is a reason why. This excerpt is from the McDonald’s website: There are many reasons the Coca-Cola tastes so great at McDonald’s. We simply follow the guidelines set by Coca-Cola and take steps to ensure it tastes the same as when you buy it in a bottle.  The water and Coca-Cola syrup are pre-chilled before entering our fountain dispensers with the ratio of syrup set to allow for ice to melt. We also keep our fountain beverage system cold so your drink can always be at the peak of refreshing. In order to ensure our drinks are always meeting a gold standard, we have proper filtration methods in place.  There’s also our straw – it’s slightly wider than a typical straw, so all that Coke taste can hit all your tastebuds.  ____ My first takeaway is how intentional McDonald’s is in making sure that a soda from their fountain tastes just as it would as if it came from a bottle. Stephen Covey famously described this strategy as, “Begin with the end in mind.” By knowing where they wanted to end (making sure a Coke in their ......
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Why You Need a High Risk Merchant Account for Your Real Estate Agency

Accepting payments, when you're in the real estate industry, it can be difficult. Why you ask? It's due to risk. Since a large portion of the real estate industry deal with trades and e-payments, being able to set up a high risk merchant account to accept online credit card payments is tantamount for day-to-day operations. So what happens when you set up a merchant account with the popular payment aggregators like PayPal, Stripe, or Square? Your business may be running smoothly for a little while, but one day you might wake up to find your payment processor has frozen or completely shut down your merchant account.  Why does that happen? It's because services like PayPal and Stripe process payments in aggregate merchant accounts that are comprised of many different businesses in a variety of industries with alternating levels of risk. Many in the real estate industry set up their merchant account with these payment aggregators because they offer instant approval. But, things change after the underwriting process is over or a customer has filed for a credit card chargeback. For real estate companies, aggregate merchant accounts can only lead to aggravation. What you need is a dedicated high risk merchant account for your real estate business. A dedicated merchant account is basically a bank account for your business. When a client sends a payment through your online payment portal, the transaction gets approved through a payment gateway provided by your eCommerce platform, and then the funds eventually end up in your......
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All I Really Need to Know for Sales Success I learned in Grade School! Part 1 of 3

Author Robert Fulghum's bestseller, All I Really Need to Know I Learned in Kindergarten, encapsulated lessons for success in life from lessons we learned in Kindergarten.  Some of this wisdom included: "clean up your own mess" and "don't take things that aren't yours".  He helped simplify the complexity of being a successful adult. Remember these lessons, act accordingly, and ideally live a more successful life!   After giving this some thought, I realized that my entire grade school journey did something similar for me.  Lessons I learned from my 1st-8th grade teachers set me up for sales success, albeit indirectly, sometimes hilariously (and embarrassingly....)!  1st grade: Mrs. Kidd. Lesson: Show pride in your work!  Mrs. Kidd chose me as the first student of the month in 1st grade!  I wasn't exactly sure what that meant but I knew it meant I had to bring in a poster board with photos of me and my family and fill in a questionnaire about what I wanted to be when I grew up. Since I was the first one, I didn't have any reference points on how this poster board should look. I waited until the last possible minute to bring in my board and kept it in a trash bag until Mrs. Kidd finally took me and my board in a bag to the hall to talk.  She asked me why I waited so long to bring in the board.  I told her I wasn't sure if I did the work correctly and......
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3 Tips to Make Your Property Improvements Pay for Themselves

  Multifamily housing is a competitive market, whether you manage new Class A's or performing Class B's and C's. This is as true now as it has ever been, especially when it comes to multifamily rental properties. Consider where market conditions are today — high demand, limited supply, relatively low interest rates, and a strong job market — along with how quickly new technologies are presenting different amenities and solutions to problems. And the biggest dilemma facing anyone who owns or manages multifamily properties is how to properly invest today in order to stay ahead of the competition now and into the future. Unless you have a crystal ball, this is no easy task.   One of my favorite professors once told me that understanding value is simple, as value is simply a function of the utility provided by a product or service divided by its cost. In recent years, market conditions have allowed market forces to drive up the price part of this equation. However, the strong economics that have been a tailwind to rate increases have also spurred new supply investments — both traditional and new asset classes like professionally managed single-family rentals — that are coming online over the next couple of years. Whether you serve rent-by-choice or rent-by-necessity residents, the right amenities are the tools that can differentiate an asset and attract and retain tenants, regardless of the economic cycle.   Most of the amenities that drove differentiation in the past cycle are now considered table stakes. ......
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